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Thursday, November 17, 2011

News from the Trenches: New Developments in the Publishing Biz by Linda Rohrbough

In September, I was in St. Louis at a fascinating discussion on the publishing business at Bouchercon, a mystery conference. It was a panel discussion with two editors, two writers, and a bookstore owner.

One of the editors was Neil Nyren from Penguin/Putnam. He’s editor to a number of best-selling authors, including Patricia Cornwell. The bookstore owner was Gary Shulze of Once Upon a Crime books in Minneapolis, one of the top independent bookstores in the country. The authors were Eric Stone and Abigail Padgett, and the other editor, Kate Grant, was from a small press. And the discussion was around the future of books and publishing and what’s happening in the industry.

Lots of interesting stuff was said. But two things stood out. The first was a discussion about the expenses behind production of ebooks. A librarian stood up and asked why, if ebooks are so much cheaper than paper books, ebooks don’t cost less than paper books. And Neil and the other editor took exception to the assumption that ebooks are cheaper to produce.

One interesting fact stated by Neil was hard cover books cost about two dollars each to produce. Yep, you’re hearing me right. Two buckaroos. For hard cover. (Imagine how cheap the paperbacks are.)

Now that figure assumes a large quantity, but still it’s a lot lower than most people would assume. Neil said the expense in producing books is in the editing, advertising and promotion, cover art, and royalties. Of course, everyone forgets cover art when it comes to ebooks. I also got the impression from the discussion that readers assume production costs will be borne by the paper version, so the ebook is essentially free. Clearly, it isn’t.

But what was even more interesting were the statistics Neil mentioned. Right now, he said ebooks account for twenty percent of sales. As a consequence, big name authors are facing lower print runs, which used to be the industry standard for the commercial success of an author. The higher your initial print runs, the better you’re doing. My friend Debbie Macomber is up to one million on her initial print runs, last I heard. That number may be higher now.

That initial print run is significant because publishers don’t print more books than they think they can move in about three months. This is because bad things happen to stored books. They get yellow, bugs eat the paper, humidity puffs them up, and all sorts of other unpleasant circumstances can ruin the final product.

Neil said his authors faced a certain amount of dismay about their print runs being lower, until they learn that the ebook sales are higher. And then they’re okay because the industry standard royalty right now on ebook sales is twenty-five percent, which is a lot higher than the royalty on paper books.

The last statistic I heard from the American Association of Publishers was that ebooks accounted for six percent of sales earlier this year. But it takes time to gather those stats, so the numbers are usually behind what’s actually happening. And given the exponential growth in sales of ebook readers, it would stand to reason that ebooks would also experience exponential growth.

As an aside, no one, it appears, trusts Amazon much. Part of the problem is there’s no third party auditing of ebook sales. Another part of the problem is Amazon appears to be encroaching on everyone’s territory.

Which brings me to my second major take away: that Amazon will be frozen out of the market anywhere it can be, if book retailers have anything to say about it. What brought that topic up was the mention of Barry Eisler.

Earlier this year, best-selling author Barry Eisler started a stir by announcing he turned down a seven figure offer from his publisher to self-publish instead. Partly because he could get to market faster with the book, which was already written, and therefore earn more. But one of my friends close to Eisler said wait, that there was another deal in the works. And sure enough, Barry didn’t self-publish after all. Instead, he and Amazon.com announced a deal where they will publish Barry’s new book on Kindle and on paper through Amazon’s CreateSpace. So CreateSpace has become a publishing house instead of a vanity press.

Here’s where it gets interesting, because it took me by surprise. The bookstore owner Gary Shultz, shook his head, looked down and said, “We miss Barry.” Like Barry died. As the discussion went on, I realized that in a way, Barry had died, because Gary also said they have no intention of carrying any books published by CreateSpace. And I suspect most of the standard retail distribution outlets in the country are going to feel the same way. Amazon is their biggest competitor, so they are not going to share.

Did Barry just knock himself and his books out of the retail distribution channel? And if readers married to hard copy can get what they want from CreateSpace, will they care that they can’t get the titles from their favorite local book distributor? Will it go so far that bookstores will boycott all Barry Eisler’s titles, and not just those published by CreateSpace?

Barry didn’t always have this attitude. His initial book published by Putnam had national distribution so he took several weeks driving the U.S. alone promoting the book. He introduced himself and signed stock in every bookstore he could reasonably get to. He told about it at a writer’s conference I was speaking at in Amarillo in 2002, and the number of bookstores numbered in the hundreds. So he believed in the retail channel, at least at first. But then his books took off, he got a movie deal, spent a year in Japan during the filming, and so on. Clearly, he’s changed his mind.

Debbie Macomber told me she romances bookstores. She learned from watching her father, who made furniture and built relationships with furniture retailers. This isn’t new. Author Jacqueline Susann (Valley of the Dolls) was known for going to the distributor warehouses early in the morning with boxes of fresh donuts for the drivers so they would be more inclined to stock her book on their routes.

Barry’s move begs the question: Are the days of building relationships with retailers and distributors ending? I don’t think so. But Amazon better watch their step because if the regular distribution channels get the chance to take them out, the carnage won’t be pretty. While Amazon may be too far in the clouds to reach, a single author is much more accessible. My guess is Barry’s move is going to be seen across the retail channels as a bite to the hand that fed him. I think it’s going to hurt him. But, obviously, he doesn’t think so.

Barry is no dummy, though. He is currently offering a short story on his website for free download, with pictures of the locale in Paris where the story is set. Included in the download are the first three chapters of the novel from the Amazon deal. He’s clearly romancing his reader base. Will it work? It’ll be interesting to watch how things shake out.

About the Writer:Linda Rohrbough has been writing since 1989, and has more than 5,000 articles and seven books to her credit along with national awards for her fiction and non-fiction. New York Times #1 bestselling author Debbie Macomber said about Linda’s new novel: "This is fast-paced, thrilling, edge-of-the-seat reading. The Prophetess One: At Risk had me flipping the pages and holding my breath." She recently won the 2011 Global eBook Award and the 2011 Millennium Star Publishing Award for her new novel. An iPhone App of her popular “Pitch Your Book” workshop is available in the Apple iTunes store. Visit her website: www.LindaRohrbough.com.

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